Needham Remains On The Sidelines With Vertex Pharmaceuticals Incorporated Despite Positive FDA AdCom Vote

The FDA advisory committee recommended this week that the FDA approve Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX)’s Orkambi therapy to treat cystic fibrosis. By a vote of 12 to 1 the panel concluded that the benefits of Orkambi outweigh the potential risks. The FDA is expected to announce final approval or rejection by early July.

In response, Needham analyst Alan Carr came out with his views on the stock following the positive Orkambi adcom. The analyst reiterated a Hold rating on VRTX, while no price target was provided.

Carr noted, “Although the FDA documents introduced increased risk to approval, we believe the vote yesterday mitigates most of it and we still assume approval by the 7/5/15 PDUFA date. Nevertheless, we believe the stock already reflects FDA approval and successful commercial launch.”

“Our HOLD rating is based on our assumption that successful commercialization of Kalydeco, Orkambi, and ivacaftor/ VX-661 are currently reflected in the stock. We estimate WW Kalydeco monotherapy peak sales of around $1B in patients with gating mutations. We believe peak sales potential for Orkambi is around $5B WW. There are additional revenue growth opportunities related to potential combination of ivacaftor with VX-661 and other corrector compounds.”, the analyst added.


According to, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Alan Carr has a total average return of 38.4% and a 74.0% success rate. Carr has a 35.2% average return when recommending VRTX, and is ranked #3 out of 3602 analysts.

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